The Ultimate Market Forecaster: Martin Armstrong

Armstrong Painting
Martin Armstrong

Martin Armstrong is a controversial market analyst who correctly predicted the 1987 crash, the top of the Japanese market, and many other market events … more or less to the day.

Many market timers think that Armstrong is one of the very best.  Armstrong credits a computer program he created (which he calls “Socrates”) for the accuracy of his forecasting.

Armstrong’s background is even more dramatic because he was jailed for 11 years on trumped-up allegations of contempt, fraud and an alleged Ponzi scheme.   Armstrong was ultimately released without any charges, and – as the documentary The Forecaster explains – the 11-year imprisonment was a way to try to pressure him to hand over his forecasting program.

Washington’s Blog sent a reporter to Armstrong’s annual conference in Orlando, Florida, to see what all the buzz is about …

Armstrong presented a wealth of very specific predicts about the timing of various markets and currencies worldwide (Armstrong’s models are proprietary, so we won’t discuss them here).

But Armstrong also made a number of interesting economic and political comments which make us think he’s pretty darn smart …

For example, he said that world capital flows peaked in 2000, and – along with the world economy – have actually been declining ever since.  Armstrong said that some individual countries’ capital flows went up until 2007 … but even they have been declining since then.

Armstrong predicted that the government bond market has peaked.  Armstrong said it’s better to move out of government debt and into private debt. Specifically, when governments default, you get nothing.  But when private companies default, there are still some tangible assets to be divvied up. He suggested buying AA or AAA blue chip corporate debt.

He also forecast that Europe will become even more of a basket case, driving huge amounts of capital flooding into the U.S., creating a giant U.S. stock market bubble.

But Armstrong predicts that – like all bubbles – the U.S. stock market will end up deflating within a couple of years.

Specifically, Armstrong tells Washington’s Blog:

The rush of cash into the US has little place to go but equities. The bubble would be indicated when we exceed the 23,000 level and if we achieve a monetary reform where the dollar is replaced with a new reserve currency basket. The trade problems Trump will face are because those in Washington do not grasp the role of currency.

I do not see a 1929 type crash. That is when the private sector melts down. This time it will be government. That is why most analysts have been wrong. They keep preaching the same scenario, gold up, stocks, down, dollar to zero.

They do not understand that sometimes governments go bust and when that happens, you get strange results that do not mirror 1929.

In terms of Brexit and the EU, Armstrong said:

While all the hype how Britain will fail because it has left the EU, there is absolutely no evidence that such a result will unfold.  The EU is in a major crisis and the system cannot possibly work … the only way Britain will not be dragged down with Europe was to exit the EU.

Their own data shows that GDP growth annually peaked in 1973 PRIOR to joining the EU. So much for this idea that [trade blocks] are everything.

On the push for eliminating cash, Armstrong said:

Their theory is that cash is what’s preventing them from completely controlling the economy.

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The propaganda is “cash is for criminals”.

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They have this view that if they can eliminate cash, they can get whatever they want in taxes out of you. You have no way of doing a bank run … there’s no money.

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And they can take interest rates negative.

Armstrong slammed The Foreign Account Tax Compliance Act (“Fatca”), saying that it’s just a way for governments to try to tax and grab people’s money … and that it’s depressing money flows, and thus the global economy.

In terms of negative interest rates in Europe, Armstrong said that  European banks just sent cash to their American affiliates, who then parked excess reserves at Fed. So European banks weren’t subject to negative rates. Instead, they got paid by Fed to park their money.  (Background.) European banks also play the mismatch in financial year ends between Europe and the UK.

And Armstrong says that the economic system is broken because politicians are motivated to ignore the real world so they can continue manipulating things for their own benefit:

The bottom-line crisis that we face is a crisis in philosophy. There is no interest in studying HOW the economy actually functions. Where’s the fun in that?

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Economists line up with their hands out looking for money and spin wonderful stories about how government can manipulate the world to its benefit.  Whatever the governments pays them to suggest!

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Government has no interest in Laizzez-faire economics for that maintains that the economy is far too complex for government to interfere. Governments embrace Marx and Keynes because they gave politicians the idea that they can manipulate the world for their political gain.

See this for more on Armstrong.

 

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  • WillDippel

    Here is an article that looks one indicator that tells us whether the stock market is fairly valued:

    http://viableopposition.blogspot.ca/2016/12/what-is-cyclically-adjusted-price.html

    There’s one thing that we can count on; everything eventually reverts to the average.

  • diogenes

    Armstrong doesn’t like FATCA(t) because that’s who he speaks for. Who else has “investment” money to purchase investment serfs with?

    • jserink2004

      FACTA doesn’t affect the rich, it affects you!
      It’s like income tax, you remember that no? They were ONLY going to tax the rich…..problem is no one ever held the FED GOV’S feet to the fire to define who the rich actually are. Well, the rich are you. If you’re not eating out of garbage cans in a back alley, you’re rich so hand it over schlub. We can’t have senator’s and Congressmen with no pension fund and less than 30 staffers each, can we? Tax tax tax tax….its never enough and even then, they’ve still blown through 20T o your great grand children’s future taxes WITHOUT counting future liabilities.

      FACTA is something the East Germans would have come up with.

      Just remember, the best slaves think they’re free.

      Jim

  • jadan

    If the economy is far too complex for government to interfere, then the environment, the weather, the human body, space travel and so on and so on, including cryptocurrencies, are far too complex to interfere with also. We might just as well give up on the notion we can create systems that deliver justice, peace, harmony. This anti-government free market point of view is a self-destructive juggernaut of idiocy. Trump will show us just how bad things can get when he lets the big predators out of their cages. This Armstrong is a lucky bull shit artist. “They put me in prison because they wanted my shit and I wouldn’t give it to them” is a good con, especially when they actually did put you in prison. But keep this in mind: not even God can predict the future. He likes it that way. That’s what makes us free.

    • brodave

      “bull shit artist”, “good con”, then surely you have verifiable information to backup these claims?
      And “trump will show us just how bad things can get” seems to imply you are also a fortune teller. I would appreciate any information you can provide to back this up too.

      I’ll be waiting. If you provide no factual material then I will just assume that you are a butt-hurt liberal loser.

      • jadan

        Ever hear of the “uncertainty principle”, brodave? That is some verifiable information, but it might be above your pay grade. So you go ahead and be guided by your financial guru and raise your arm to your Oligarch. Guard your own ass hole, bro, because there’s a strong probability you’re going to be damaged by the ones you love……

  • JJ Cale

    all these shills who claim to be such amazing analysts also need to prove they can trade the markets by making some hard $$. Martin’s been out of jail for 3-4 years now in some of the most volatile markets we’ve ever seen and he predicted it all correctly ? so his net worth should be in the hundreds of millions by now surely ? proof of the pudding is in the eating – any fool can make some blanket predictions and then claim they were right after the fact.

    • brodave

      Well, well, then do tell us what Armstrong’s net worth is.

      I’ll be waiting.

      • I have earned 104000 dollars in last twelve months by doing an on-line job from home and I did that by w­o­r­k­i­n­g part time f­­o­­r several hours a day. I followed a money making model I found on-line and I am amazed that i earned so much extra income. It’s really user friendly and I’m just so blessed that I found out about it. Here’s what I did… http://statictab.com/dntj48t

  • ksdreger

    Armstrong is like Nostradamus, you hear what you want to hear.

  • Bradfromearth

    For the haters. If you search some of his recent interviews done via skype you can see him in his office. Behind him is the bust of Julius Caesar that the courts were forced to return to him. If he were broke he wouldn’t have a 15 million dollar artifact in his office. He would sell it. His net worth was known to be massive prior to his legal troubles he was finally let out of jail and plead to some piddly charges. The courts had to return his assets. I imagine he spent a lot of legal but still. Bare minimum I would guess he is worth 300-500 million. At best in the billions.